Banks cling on to early repayment commissions

Banks are opposed to the proposal of the National Authority for Consumer Protection (ANPC) for provisions of the new law of credits, which will come into force on June 12th, to be applied to existing clients, as well. The proposal entails the modification of more than 7 million credit contracts worth 25 billion euros.

The draft law on loans granted to the population, put together by the ANPC and currently subject to public debate, is largely based on the European directive on consumer loans, which needs to be translated into local legislation by June 2010.

ANPC, however, wants to have, under the new credit law, the capping of the early repayment commission to 1% extended to all types of loans, not only consumer loans, and also wants it applied both to new clients, and to those with existing loans.

"We have also included other provisions in the draft law, in addition to those provided for in the European directive. One of the new elements is that the law be applied to all existing lending contracts, which are around 7 million. This provision has generated dissatisfaction among banks, which argue that one cannot be more Catholic than the Pope!," said Constantin Cerbulescu, chairman of the ANPC at a debate organised on the World Consumer Rights Day.

On the other side of the argument, bankers say the law cannot be enforced retroactively.